The following information is taken from the production budget for the first quarter: Beginning inventory in units 1200 Sales budgeted for the quarter 356000 Capacity in units of production facility 402000 How many finished goods units should be produced during the quarter if the company desires 3200 units available to start the next quarter

Answers

Answer 1

Answer:

358,000

Explanation:

The number of units to be produced is dependent on the desired closing units, the sales and opening balance

Hence,

Opening balance + Units produced - Sales = Closing balance

Let the goods produced be y

1,200 + y - 356,000 = 3,200

y = 3,200 + 356,000 - 1,200

y = 358,000

The company should produce 358,000 units during the quarter if company desires 3,200 units available to start the next quarter.


Related Questions

Anastasia is a principal who is responsible for telling one of her teachers that the school will be cutting her Spanish program in the fall. She has been friends with this teacher for years and knows that the teacher will be very upset. What is the most appropriate communication channel for Anastasia to choose to share this news with the teacher in this scenario?

Question 2 options:

She should send the teacher a formal, typed letter.


She should talk to the teacher face-to-face.


She should send the teacher a text message.


She should post the news on the school website.

Answers

Answer she should talk to her face to face

Explanation:

if she respects this woman that is the best way to keep it

Consider a project with the following data: accounting break-even quantity = 16,700 units; cash break-even quantity = 15,000 units; life = four years; fixed costs = $150,000; variable costs = $32 per unit; required return = 15 percent. Ignoring the effect of taxes, find the financial break-even quantity. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Answers

Answer: 17381.80 units

Explanation:

To solve the question, the OCF need to be known. To solve this, we need to know the price of the project which will be:

15000 = $150,000/(P - $32)

15000P - 480000 = 150000

15000P = 150000 + 480000

15000P = 630000.

P = 630000/150000

P = 42

Since we know the price, we'll calculate depreciation which will be:

16700 = ($150,000 + D)/($42 -$32)

Depreciation = 17000

Based on the information, initial investment will now be:

= 4 × 17000

= 68000

Then, we can now solve the OCF which will be:

68000 = OCF(PVIFA15%,4)

OCF = 23818.04

Therefore, the financial breakeven quantity will be:

= 150,000 + 23818.04/(42-32)

= (150000 + 23818.04)/10

= 173818/10

= 17381.80 units

Therefore, the financial breakeven quantity is 17381.80 units

LM Enterprises produces two products in a common production process, each of which is processed further after the split-off point. Joint costs incurred for the current month are $36,000. The following information for the current month was also gathered: Product Units Produced Units Sold Separable Costs Selling Price per Unit L 10,000 9,500 $20,000 $ 8 M 5,000 4,000 $40,000 20 What amount would be the joint cost allocated to product M, assuming that LM Enterprises uses the estimated net realizable value method to allocate costs

Answers

Answer:

$18,000

Explanation:

The computation is shown below

As we know that

Net realizable value = eventual sales price -  separable costs.

For Product L, the net realizable value is

= (10,000 units  ×$8) - $20,000

= $80,000 - $20,000

= $60,000

For Product M, the net realizable value is

= (5,000 units ×$20) - $40,000

= $100,000 - $40,000

= $60,000

Now Net realizable value of the two products is

= $60,000 + $60,000

= $120,000

Product M is allocated 60 ÷ 120 or 50% of joint costs.

So,

= 50% of $36,000

= $18,000

The payroll records of Speedy Software show the following information about Marsha Gottschalk, an employee, for the weekly pay period ending September 30, 2017. Gottschalk is single and claims one allowance. Compute her Social Security tax (6.2%), Medicare tax (1.45%), federal income tax withholding, state income tax (1.0%), and net pay for the current pay period.

Total (gross) earnings for current pay period $620
Cumulative earnings of previous pay periods $8,060

Answers

Answer:

The Social Security Tax is $38.44

The Medicare Tax is $8.99

The Federal Income Tax withholding is $70.00

The Income Tax is $6.2

The Net Pay is $496.37

Explanation:

Use the following formula to calculate the Social Security Tax

Social Security Tax = Gross Pay  x Social Security tax rate = $620 x 6.2% = $38.44

Use the following formula to calculate the Medicare Tax withholding

Medicare Tax = Gross Pay  x Medicare tax rate = $620 x 1.45% = $8.99

Federal Income Tax withholding = $70.00 ( From the attached Table )

Use the following formula to calculate the Income Tax

Income Tax = Gross Pay x Income tax rate = $620 x 1% = $6.2

Use the following formula to calculate the net pay

Net Pay = Gross Pay - Social Security Tax - Medicare Tax - Federal Income Tax withholdiing - Income Tax = $620 - $38.44 - $8.99 - $70.00 - $6.2 = $496.37

Credit unions are for-profit organizations. O A True ОВ. False​

Answers

The answer.. B). False
The correct answer is b Bec is False

An outside supplier has offered to manufacture product Y for you at a wholesale price of $2 per unit. You currently make product Y in-house at a cost of $7/unit, which consists of $2/unit of fixed costs and $5/unit of variable costs. You need 1,000 units of Y per month. If you outsource the production of Y to the outside supplier in the short term, your profit will: Group of answer choices increase by $3,000 decrease by $2,000 decrease by $3,000 increase by $2,000 remain the same

Answers

Answer:

The profit will increase by $3,000.

Explanation:

This is a make or buy decision and the only relevant cost is the variable cost as the fixed is sunk cost. Therefore, we have:

Cost of buying from outside = Cost of buying from outside per unit * Number of units needed = $2 * 1,000 = $2,000

Cost making it internally = Variable cost per unit * Number of units needed = $5 * 1,000 = $5,000

Since Cost making it internally is greater, the amount by which profit increase can be calculated as follows:

Amount of increase in profit = Cost making it internally - Cost of buying from outside = $5,000 - $2,000 = $3,000

Therefore, the profit will increase by $3,000.

Harry Company sells 38,000 units at $37 per unit. Variable costs are $30.71 per unit, and fixed costs are $136,200. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) operating income. a. Contribution margin ratio (Enter as a whole number.) fill in the blank 1 % b. Unit contribution margin (Round to the nearest cent.) $fill in the blank 2 per unit c. Operating income $fill in the blank 3

Answers

Answer:

Results are below.

Explanation:

First, we will determine the unitary contribution margin:

Unitary contribution margin= selling price - unitary variable cost

Unitary contribution margin= 37 - 30.71

Unitary contribution margin= $6.29

Now, the contribution margin ratio:

contribution margin ratio= Unitary contribution margin / selling price

contribution margin ratio= 6.29 / 37

contribution margin ratio= 0.17

Finally, the operating income:

Operating income= total contribution margin - fixed costs

Operating income= 38,000*6.29 - 136,200

Operating income= $102,820

15 stores and their distribution warehouse. The Paint Supply Store franchise sells an average of 70 gallons of Purple Paint every week (for 52 weeks per year). Their current policy is that when they place an order for Purple Paint from their supplier, they order 90 gallons at a price of $4.00 per gallon. [The company does not hold Safety Stock] It takes 2.50 weeks to receive an order from the supplier. Administrative costs for Ordering paint have been estimated to be $35 per order. Holding Costs = 40% of the purchase price per gallon per year. What is the Total Annual Inventory Cost for the company's current policy?

Answers

Answer: $1,487.56

Explanation:

Total annual inventory cost = Ordering cost + Inventory Holding cost

Ordering cost = Number of orders * ordering cost

= (Annual demand / Order quantity) * 35

= ((52 weeks per year * 70) / 90) * 35

= $1,415.56

Inventory holding cost:

= Average inventory * holding cost

= (90 gallons / 2) * (40% * 4)

= $72

Total annual inventory cost = 1,415.56 + 36

= $1,487.56

The following accounts are from last year's books at Sharp Manufacturing: Raw Materials Bal 0 (b) 87,000 (a) 93,000 5,000 Work In Process Bal 0 (f) 251,000 (b) 69,000 (c) 82,000 (e) 100,000 0 Finished Goods Bal 0 (g) 226,000 (f) 251,000 25,000 Manufacturing Overhead (b) 18,000 (e) 100,000 (c) 12,000 (d) 67,000 (h) 3,000 3,000 Cost of Goods Sold (g) 226,000 (h) 3,000 223,000 Sharp uses job-order costing and applies manufacturing overhead to jobs based on direct labor costs. What is the amount of cost of goods manufactured for the year?

Answers

Answer:

$251,000

Explanation:

Calculation to determine the amount of cost of goods manufactured for the year

Using this formula

Cost of goods manufactured=Debit to Finished Goods+Credit to Work in Process

Let plug in the formula

Cost of goods manufactured =$226,000+$25,000

Cost of goods manufactured =$251,000 (entry f)

Therefore the amount of cost of goods manufactured for the year is $251,000 (entry f)

Actual sales price is 20% higher than budgeted. Actual sales revenue in dollars is 14% higher than budgeted. Actual sales volume in units is 5% lower than budgeted. Actual input quantity per unit is 2% higher than budgeted. Actual input price is 4% lower than budgeted. Which of the following is true: Group of answer choices Sales volume variance is unfavorable and input efficiency variance is unfavorable Sales volume variance is unfavorable and input efficiency variance is favorable Sales volume variance is favorable and input efficiency variance is unfavorable Not enough information Sales volume variance is favorable and input efficiency variance is favorable

Answers

Answer: Sales volume variance is unfavorable and input efficiency variance is unfavorable

Explanation:

The sales volume variance is regarded as the difference in the revenue or the profit which is as a result of the difference between the actual sales and the budgeted sales.

With regards to the question, since the Actual sales volume in units is 5% lower than the budgeted sales, we can infer that the sales volume variance will be unfavourable. On the other hand, since, the actual input quantity per unit is 2% higher than budgeted input quantity per unit, then we can infer that the input efficient variance is unfavourable.

The Kentucky government approves tax incentives to encourage more industry to move to the state. Which of the following statements best describes a potential negative externality? (1 point)

a
Development results in reduction of green space.

b
Taxes for local road maintenance decrease.

c
The state gambling industry fails to fund education.

d
The state park system loses positive media coverage.

Answers

Answer:

a

Explanation:

A good has positive externality if the benefits to third parties not involved in production is greater than the cost. an example of an activity that generates positive externality is research and development. Due to the high cost of R & D, they are usually under-produced. Government can encourage the production of activities that generate positive externality by granting subsidies.

A good has negative externality if the costs to third parties not involved in production is greater than the benefits. an example of an activity that generates negative externality is pollution. Pollution can be generated at little or no cost, so they are usually overproduced. Government can discourage the production of activities that generate negative externality by taxation. Taxation increases the cost of production and therefore discourages overproduction. Tax levied on externality is known as Pigouvian tax.

Government can regulate the amount of externality produced by placing an upper limit on the amount of negative externality permissible

Teal Mountain Corporation recorded a right-of-use asset for $312,900 as a result of a finance lease on December 31, 2019. Teal Mountain’s incremental borrowing rate is 10%, and the implicit rate of the lessor was not known at the commencement of the lease. Teal Mountain made the first lease payment of $58,429 on on December 31, 2019. The lease requires 7 annual payments. The equipment has a useful life of 7 years with no residual value.
Prepare Teal Mountain's December 31, 2017, entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to O decimal places e.g. 5,275.)
Date Account Titles and Explanation Debit Credit
December 31, 2017

Answers

Answer:

Date           Account titles and Explanation         Debit       Credit

31 Dec 19   Lease liability                                     $32,982

                  Interest expense                                $25,447

                  [(312900-58,429)*10%]

                          Cash                                                              $58,429

                   (To record interest expense)

31 Dec 19   Amortization expense                        $44,700

                  [312,900/7]

                          Right of use asset                                         $44,700

                  (To record amortization of the right of use asset)

Which of the following are ways that business directly benefits
society?
Choose 5 correct answers.
Encourages innovation
Raises self-esteem
Extends lifespan
Builds social bonds in the workplace
Provides employment
Encourages entrepreneurship
Teaches critical thinking skills
Allows for specialization through competition

Answers

Answer: Encourages innovation

Raises self-esteem

Provides employment

Encourages entrepreneurship

Teaches critical thinking skills

Explanation: All the above five points can be the core points for a business to have a good impact on the society. A business does not only helps to grow the one who is the boss but it also benefits the society in many ways. A business with the above mentioned goals is a boon for the society.

Apple invented the modern smart phone but Android con trolled 80 percent of the world market in 2016 because of:__________.

Answers

Answer:

Stimulus diffusion

Explanation:

In simple words, When a concept spreads from its historical flame outwards, the original thought is altered by the future followers which is known as stimulus diffusion. Given of the manner civilization adjusts to various environmental, economic, as well as political contexts, mostly all cultural evicting will include some form of stimulus dissemination.

Thus, from the above we can conclude that the correct answer is stimulus diffusion.

Decrease in accounts receivable $ 33,000 Increase in accounts payable $ 20,000 Increase in retained earnings $ 110,000 Cash paid for purchase of new music equipment $ 29,000 Depreciation expense $ 6,800 Klutz uses the indirect method to prepare its statement of cash flows. What is Klutz's net cash provided by (used in) operating activities

Answers

Answer:

$262,800

Explanation:

Missing word: "Klutz Dance Studio had net income of $203,000 for the year just ended. Klutz collected the following additional information to prepare its statement of cash flows for the year:"

Particulars                                                                           Amount

Net income                                                                         $203,000

Adjustments to reconcile net income to

net cash flows from operating activities  

Depreciation                                                    $6,800

Decrease in accounts receivable                   $33,000

Increase in accounts payable                         $20,000   $59,800

Net cash provided by operating activities                     $262,800

Broadbean Co. had the following amounts on its balance sheet on December 31, 2018: Common stock and Additional paid in capital $ 106,000 Retained earnings 642,000 Treasury stock 82,000 Accumulated other comprehensive income (loss) $ (25,000 ) During 2019, Broadbean Co. reported net income of $46,200, declared cash dividends of $31,800, purchased additional treasury stock for $8,400, and experienced a foreign currency translation gain of $3,600. What amount will Broadbean report as total stockholders’ equity at December 31, 2019 on its statement of stockholders’ equity? Multiple Choice

Answers

Answer:

$650,600

Explanation:

       Stockholders’ equity as at December 31, 2019

Common stock and Additional paid in capital          $106,000

Retained earnings {642000+46200-31800]             $656,400

Less: Treasury stock [82000+8400]                          $90,400

Accumulated other comprehensive income             ($21,400)

(loss) [(25000)+3600]

Stockholders’ equity                                                   $650.600

As loan analyst for Second Bank, you have been presented the following information.

Pink Co. Blue Co.
Assets
Cash 120,000 320,000
Receivables 220,000 302,000
Inventories 570,000 518,000
Total current assets 910,000 1,140,000
Other assets 500,000 612,000
Total Assets 1,410,000 1,752,000
Liabilities and Stockholder's Equity
Current liabilities 305,000 350,000
Long-term liabilities 400,000 500,000
Capital Stock and Retained Earnings 705,000 902,000
Total liabilities and Stockholder's equity 1,410,000 1,752,000

Annual Sales 930,000 1,500,000
Rate of Gross Profit on sales 30% 40%

Each of these companies has requested a loan of $50,000 for 6 months with no collateral offered. In as much as your bank has reached its quota for loans of this type, only one of these requests is to be granted.

Question:
Which of the two companies, as judged by the information given above, would you recommend as the better risk and why? Assume that the ending account balances are representative of the entire year.

I have the work done...I just need to check my work. I would appreciate any help as soon as possible.

Answers

Based on the computed liquidity ratios below, the loan should be advanced to Blue Co. It has better performing liquidity ratios than Pink Co.

What are liquidity ratios?

Liquidity ratios assess a company's ability to pay off its short-term liabilities. Liquidity ratios determine how quickly a company can convert assets and use them to pay off debts. The higher the ratio, the easier it is to clear debts and avoid payment defaults.

Current Ratio = Current assets/Current liabilities

                                                 Pink Co.                              Blue Co.

Current Ratio               $910,000/$305,000         $1,140,000/$350,000                                

                                                 = 2.98                               = 3.25

Quick Ratio =  (Current assets - Inventory)/Current liabilities

                                           Pink Co.                         Blue  Co.

Quick Ratio    910,000-570,000/305,000       1,140,000-518,000/350,000

                                          = 1.11                                         =1.77

Operating Cash Flow Ratio = Cash/Current liabilities

                                                           Pink Co.                           Blue Co.

Operating Cash Flow Ratio = $120,000/$305,00  $320,000/$350,000

                                               = 0.39                                = 0.91

Therefore, Blue company is at better risk due to high liquidity ratios.

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QUESTION 3 of 10: Which of the following demonstrate your restaurant's concept?

Answers

The thing that demonstrate your restaurant's concept is  a) your food.

What is  restaurant concept ?

A restaurant is a place of business that prepares and provides customers with food and beverages. Although many restaurants also provide take-out and food delivery services, meals are often served and consumed on the premises. Within the hospitality industry, which is a subset of the larger service industry, restaurants, bars, and other similar enterprises typically belong under the "food and drink" category.

The topic that characterizes your restaurant serves as your restaurant concept. Restaurant themes describe the overarching theme or philosophy that underpins a restaurant's menu, service method, and musical selection.

Therefore, option A is correct.

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missing options:

a) Your food b) Your staff c) Your presentation d) All of the above. d) All of the above.

7. How micro and macro economics are interdependent
to each other?​

Answers

Explanation:

Actually micro and macroeconomics are interdependent. The theories regarding the behaviour of some macroeconomic aggregates (but not all) are derived from theories of individual behaviour. ... Similarly, the theory of aggregate consumption function is based upon the behaviour patterns of individual consumers.

The efficient frontier of risky assets is:_______
A. The portion of the minimum-variance portfolio that represents the highest standard deviations.
B. The portion of the minimum-variance portfolio that includes the portfolios with the lowest standard deviation.
C. The portion of the minimum-variance portfolio that lies above the global minimum variance portfolio.
D. The set of portfolios that have zero standard deviation.

Answers

The answer is d I hope this helps

Which is the best general statement about the role of government in business in the United States?

Answers

Answer: Government acts to allow markets to function efficiently

The best general statement is that "Government acts to allow markets to function efficiently". Therefore, option B is correct.

The United States has a mixed economy, which means that it is a combination of a market economy and a command economy. In a market economy, businesses are free to operate without much government interference.

The government's role in business in the United States is to allow markets to function efficiently. This means that the government creates a framework in which businesses can compete and innovate without being unduly burdened by regulations. The government also provides some services that would be difficult or impossible for businesses to provide on their own, such as national defense and education.

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Your question is incomplete, most probably the full question is this:

Which is the best general statement about the role of government in business in the United States?

O A. Government owns the resources of production.

OB. Government acts to allow markets to function efficiently.

OC. The government determines what goods and services are produced.

O D. Government has no role in business.

Speedy Delivery Systems can buy a piece of equipment that is anticipated to provide an 11 percent return and can be financed at 6 percent with debt. Later in the year, the firm turns down an opportunity to buy a new machine that would yield a 9 percent return but would cost 15 percent to finance through common equity. Assume debt and common equity each represent 50 percent of the firm’s capital structure. a. Compute the weighted average cost of capital. (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Answers

Answer:

10.5%

Explanation:

WACC = weight of equity x cost of equity + weight of debt x cost of debt x (1 - tax rate)

(6% x 0.5) + (15% x 0.5) = 3% + 7.5% = 10.50%

which best describes which careers would work in offices​. for 100 points

Answers

Answer:

Trochanter

Explanation:

Marketing Information Management and Research, Distribution and Logistics, and Marketing Communications and Promotion employees can work in offices

~Thanks

~Hope this helps

Answer:

Marketing Information Management and Research, Distribution and Logistics, and Marketing Communications and Promotion employees can work in offices.

Explanation:

ik bc edge 2022

Communication which occurs with
people of similar positions would fall
under which category?
A. synchronous
C. vertical
B. a synchronous
D. horizontal

Answers

Communication which occurs with people of similar positions is called horizontal.

What is communication?

Giving, receiving, and exchanging information are all parts of communication, which might take the form of talking, writing, listening, or reading. Effective communicators pay close attention to others' perspectives, talk or write effectively, and respect them. Kids that have good communication skills may communicate both in person and online. Understanding how words and visuals influence other people is essential for texting, talking, and publishing safely. By modeling effective communication, training kids to use social media responsibly, and exposing them to material that values healthy communication, you may aid in their development as communicators. Depending on whether information is exchanged between people, members of other species, or non-living objects like computers, different types of communication can be classified. The contrast between verbal and non-verbal communication is significant for human communication. Language-based communications are exchanged during spoken conversation. Esperanto is an example of an artificial language, although it may also occur through natural languages like English or Japanese.

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Sandi, shift supervisor at Johnson Meatpacking, has the highest performing team. One reason for this is how she controls her team's activities. First, she ensures that her subordinates are properly trained and properly equipped with the necessary protective equipment and work tools. Then, during the shift, she carefully monitors her workers' actions, taking notes and even measurements as needed. Finally, at the end of each work week, she analyzes her notes and measurement data, and she uses the results of her analysis to make needed production changes the following week. When Sandi is monitoring her workers' actions, she is exercising ________ control.Multiple Choicefeedforwardconcurrentforwardfeedbackexternal

Answers

Answer:

concurrent

Explanation:

Concurrent  control is when the work done by labour is monitored as the task is being performed. This is to ensure that the product of labour meets quality standards.

Feedback control involves reviewing information on the performance of workers to determine if performance meets quality standards.

Feedforward controls is also known as preventive control : identifies deviation from quality standards before they occur

Mandy, who has AGI of $80,000 before considering rental activities, is active in three separate real estate rental activities. Mandy has a marginal tax rate of 22%. She has $12,000 of losses from Activity A, $18,000 of losses from Activity B, and income of $10,000 from Activity C. She also has $2,100 of tax credits from Activity A. Calculate her deductions and credits allowed and the suspended losses and credits.

Answers

Answer: See explanation

Explanation:

Mandy's deductions and credits allowed and the suspended losses and credits are calculated as follows:

Mandy's deduction (her utilized loss) total = $12000 + $18000 - $10000 = $20000

Her suspended loss = $0

After deducting the loss, Mandy has available a deduction equivalent of = $5000

Hee utilized credit is ($5000 × 22%) = $1100 and her suspended credit is ($2100 - $1100) = $1000.

Which entities offer certifications and qualifications in accounting that will help increase your future earning potential, deepen your knowledge, and enhance your credibility in the field?

Answers

Answer:

Entities that offer certifications and qualifications in accounting that will help increase your future earning potential, deepen your knowledge, and enhance your credibility in the field include:

Explanation:

Certified Public Accountant (CPA), Certified Financial Analyst (CFA), Certified Fraud Examiner (CFE), and Certified Internal Auditor (CIA). Additionally, organizations such as the American Institute of Certified Public Accountants, the Institute of Management Accountants, and the International Ethics Standards Board for Accountants (IESBA) offer certifications and qualifications that are beneficial for those in the accounting field.

Regardless which form of media used, all ads can be divided into _?_types based on the kind of message conveyed.
seven
C. five
b. two
d. three
a.

Answers

D. three types of ads
B is correct
Because is true

"Group Think" happens when
everyone agrees with the same
thought.
True or false

Answers

It is a phenomenon that can lead to poor decision-making True.

What is group think?

Group think is a phenomenon in which a group of people, influenced by their desire for consensus, make irrational or poor decisions. It often occurs when group members are unwilling or unable to express their individual opinions, or when group members feel pressure from an authority figure to come to an agreement. Group think can lead to poor decision-making, as group members may ignore potential problems or negative information that could be beneficial to the decision-making process. Additionally, group think can lead to conformity among members, making it difficult for them to think outside the box and come up with creative solutions.

Group Think can lead to poor decision-making because it eliminates any divergence of opinion, leading to conformity and the absence of critical thought. This can lead to an inability to objectively evaluate the risks and benefits involved in a decision, as well as a lack of creativity and innovation. Additionally, group think can lead to a lack of accountability, as members of a group may be less likely to challenge decisions or provide constructive criticism.

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Net Present Value Analysis [LO12-2]
Kathy Myers frequently purchases stocks and bonds, but she is uncertain how to determine the rate of return that she is earning. For example, three years ago she paid $13,000 for 200 shares of Malti Company’s common stock. She received a $420 cash dividend on the stock at the end of each year for three years. At the end of three years, she sold the stock for $16,000. Kathy would like to earn a return of at least 14% on all of her investments. She is not sure whether the Malti Company stock provide a 14% return and would like some help with the necessary computations.
Required:
1. Compute the net present value that Kathy earned on her investment in Malti Company stock.
2. Did the Malti Company stock provide a 14% return?

Answers

Answer:

NPV = $-1,225.37

No. The return is less than 14%, because the net present value is negative

Explanation:

Net present value is the present value of after-tax cash flows from an investment less the amount invested.  

Only projects with a positive NPV should be accepted. A project with a negative NPV should not be chosen because it isn't profitable.  

NPV can be calculated using a financial calculator

Cash flow in year 0 = $-13,000

Cash flow in year 1 and 2 = 420

Cash flow in year 3 = $420 + $16,000 = $16,420.

I = 14%

NPV = $-1,225.37

The return is less than 14%, because the net present value is negative

To find the NPV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

3. Press compute  

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